Whale Watching: Paulson & Co. Speared By Banks & Gold (BAC, COF, C, JPM, WFC, XL, NYX, GLD, TEVA, FDO, MGM, HPQ, AMCX, CEPH, COV, CVS, MYL)

Paulson & Co. Inc. is another hedge fund group that investors use for Whale Watching, although this last quarter was not exactly kind to Mr. Paulson’s billions… The current 13F report shows total September 30, 2011 of $20.68 billion.  While still huge, that is down from $29.057 billion just a quarter before.  The biggest changes appear to be in the financial stocks and banks, as well as in gold.  We have outlined come of the key changes of those and others below, including some new positions taken.

BANK STAKE GAINS: Bank of America Corporation (NYSE: BAC) was listed as a larger position at 64.3+ million shares, higher by almost 4 million shares.  Keep in mind that there are also positions in warrants due 2018 and 2019 in the position at BofA.  Capital One Financial Corporation (NYSE: COF) was raised slightly to 22,200,000 shares worth $879.7 million, but the old stake of 21,100,000 shares worth $1.09 billion. 

BANK STAKES LOWERED OR ELIMINATED (partial): Citigroup Inc. (NYSE: C) was a much lower stake at 25.1 million shares worth $643 million versus a stake of 33.5 million shares worth some $1.395 billion a quarter earlier.  J. P. Morgan Chase & Co. (NYSE: JPM) was not even listed as a position, yet it was about 4.7 million shares at the June 30 report ( but there is still a warrant position).  Wells Fargo & Co. (NYSE: WFC) is a lower position of 23,847,900 shares worth $575 million versus the prior position of 33,600,000 shares worth $942 million. XL Group plc (NYSE: XL) was lowered as well to 23.675 million shares worth $445 million versus his previous larger position of 28.23 million shares worth $620 million. NYSE Euronext, Inc. (NYSE: NYX) was dropped from the positions entirely after being listed as 3 million shares a quarter before.

PAULSON’s OTHER LOWERED POSITIONS (partial): SPDR Gold Trust (NYSE: GLD) was cut by more than one-third down to 20,273,540 shares (now worth $3.2 billion) versus 31,500,000 shares worth nearly $4.6 billion previously. Teva Pharmaceutical Industries (NASDAQ: TEVA) was cut by more than half to 1,976,900 shares worth $73.5 million from 4.18 million shares worth $201 million.  The stakes in FAMILY DOLLAR STORES INC. (NYSE: FDO) and the stake in MGM RESORTS INTERNATIONAL (NYSE: MGM) were also lowered by Paulson.  Hewlett-Packard Co. (NYSE: HPQ) was lowered to 15.2 million shares worth $340 million from 23.5 million shares worth $855 million a quarter earlier.

PAULSON’s NEW POSTIONS:  AMC Networks Inc. (NASDAQ: AMCX) is a new position of 5,000,000 shares worth $159 million, making Paulson a zombie fan for The Walking Dead.  Cephalon Inc. (NASDAQ: CEPH) is a new position of 3,684,000 shares worth some $297 million.  Covidien PLC (NYSE: COV) is a new position of 2,000,000 shares with some $88.2 million.  CVS Caremark Corporation (NYSE: CVS) was another new position of 2,500,000 shares worth almost $84 million.

Mylan, Inc. (NASDAQ: MYL) was a higher stake of 24,896,500 shares worth $423 million versus 14,940,000 shares worth $368 million previously.

Fortunately for Mr. Paulson, the markets have recovered handily since the end of September and the start of October.

JON C. OGG